QUESTION quot; 3aquot; ONLY AND SHOW FULL WORK AND EXPLANATION!

QUESTION ” 3a” ONLY AND SHOW FULL WORK AND EXPLANATION!! if you use excel please attach file in answer

3. (40 points) capital budgeting , time value of money 

You are given with the following information of two projects planned by your company. Each cash flow per year shown in Table 1 represents the cash flow at the end of each year during the project. For instance, for project A, the cash flow as 613 in first year is expected at the end of the Year 1. The initial outlays for the projects are paid out by installments with regular payments as 0.89 million at the beginning of each year for project 1 and $0.91 million per beginning of each year for project 2, respectively. 

Project            Year 1            Year 2             Year3              Year4              Year5

A                    734                 2002               1520               2317               2019

B                    638                 3109               2540

    USE THE CHART

a) Suppose the cost of capital (or so-called discount rate) is 12%, what is the Net Present Value for each project? Which project would you prefer? Why?